Posted on 02/16/2009 7:47:40 PM PST by dangermouse
8:17 CT
I do not know what is going on here, and I don't think I want to.
Someone, apparently someone in Asia, wants dollars. A LOT of dollars. There is a forced-liquidation event underway that is massive, it is against all asset classes and it is spreading.
It originated at approximately 7:15 CT this evening and originated out of Asia somewhere. All of the primary currency crosses got hit at once - Euro, Pound, Yen - all weakened dramatically against the dollar and it is still going on. The Asian stock markets got walloped at the same time in coordinated waves of forced selling.
At the same time the US futures markets got nailed as well, down some six handles on the /ES in a near-vertical drop. While this sounds "not that big" to move these markets in a coordinated fashion like this is a trillion-dollar enterprise - this is not some small company that went bankrupt, or even a large company.
There is no news coverage at the present time identifying the source of this but it is not small and contrary to some reports it is not "automatic selling"; this is forced liquidation.
Folks, if this translates into Eastern Europe where there are severe instabilities already brewing literally everything in the financial world could come apart "all at once."
The worse news is that if this happens Bernanke will have killed us (in the US) by extending those swap lines all over the planet during the last six months. These will become utterly uncollectable and they are massive, in the many hundreds of billions of dollars.
To those who are reading this, I hope if you're in the markets you are prepared for extreme levels of violence. You must expect that the authorities will try to arrest the destruction if they are able, but you must also be prepared for the possibility that we have reached a "critical mass" point beyond which "duck and cover" is the only winning strategy.
Unfortunately.
I hope I'm wrong; this is going to be a long night.
bttt
My soon-to-be 14-yr-old son should have his Eagle by June :) He’s really enjoying OA, and may even get involved some with the new Venturer Scouts they’re starting up. We’re so proud!!
It wouldn’t surprise me. Soros screwed Asia over 10 yrs ago. I’m not surprised he’d try again.
I was looking at the unusual option volume too, and it was one of the reasons why I cashed out. I’m expecting some near-term pain on the downside. I’ve also been off my game with a head cold. I rarely take drugs, and when I do, I get that “zippy the pinhead” buzz from decongestants really quickly.
I was just bringing up the difference in the term “handle” because I’ve used the term WRT equities here as well. Folks should understand that each market has its own lingo - there isn’t just “the market” — there’s multiple markets, and each one has their own lingo and such... not trying to counter anything you were saying. As I said up above, I’m not a FX guy — just watch trends in the currency markets. I reckon that trying to play FX is a good way to have the varsity team rip my head off and piddle down my neck...
February 16, 2009
New PBS outrage
Thomas Lifson
Our federally-funded propaganda broadcaster is dispensing with any pretense of nonpartisanship in a new documentary. Dan Riehl discovered via an Irish (!) source that only members of one party are interviewed on the reasons for the housing collapse:
PBS’ Frontline is airing a documentary on the causes of the economic collapse Tuesday: Inside the Meltdown. Irish media points out one possible weakness with the work. Thank God PBS isn’t biased.
“Mr. Dodd and Representative Barney Frank, Democrat of Massachusetts, are the only members of Congress interviewed in the piece, which is a weakness. Many voters hold Republicans and Democrats equally responsible for oversight failures. “Frontline” holds these politicians up as reliable, unbiased witnesses, but some viewers may feel they don’t deserve that trust.”
Will everyone just freaking calm down ? There is nothing extraordinary going on here from the size of the move, AND, the S&P futures looks like they’ve stabilized at only -13 and there seems to be some buying coming in.
______________
Well it’s on tv European market Coundown...BREAKING NEWS right now
It’s like, when the sun gets up early, then decides to back to bed until sunrise.
Finance Minister Shoichi Nakagawa
~~~
He’s gone.
Japan’s finance minister, facing ridicule and criticism for embarrassing behavior at the weekend Group of 7 meeting in Rome, said Tuesday he would resign.
http://www.nytimes.com/2009/02/18/world/asia/18japan.html?hp
Don't know how many other FReepers trade currencies, but you may rest assured that that chart (actually, about 5 years longer than the chart shown) is engraved in my alleged brain.
The Euro is going to take a pasting, a clobbering, this year. Might not be in the next 30-60 days (or it might), but LOOK OUT BELOW.
You think the **US** banks have problems? As Al Jolson would have said about Eurozone banks: ''You ain't seen NOTHIN' yet!''
However, if DAX, CAC, and FTSE tank out this a.m., look out below on SP. Shades of 1998.
So Frank and Beans also get to blow more taxpayer money producing a PBS Crockumentary manufacturing the consent to cover their large assets.
Watching DC implode under the weight of its own corruption would be more entertaining if it were not so dangerous.
Ah ha! When I saw Dodd in the clip, I mentally slapped him ..... yuck. Thank you.
~~~
Managing Director of the IMF, Dominique Strauss-Kahn appears on Charlie Rose on February 13th 2009 to talk about the banking industry’s plan for a new global central bank and monetary system with the accompanying regulatory structures.
http://www.charlierose.com/view/interview/10081
I fear the world, as we know it now, is going to vanish. God help us.
Gold and Silver are sitting at 6 month highs and climbing. The recent depreciation of Gold and Silver is over. Bottomed out 3 months ago. Perhaps we are seeing the tide start to change from deflation to inflation in certain commodities. Oil is flat, so it has temporarily decoupled. On the other side of the anecdotal coin, take a stroll through Lowe's. Lots of lower prices. They are now even selling Chinese goods that had been sold in Harbor Freight in the past. Good luck trying to get some help in the paint department however.
OK-now I’m really worried. What does this mean?
what this means AIG and others are insuring this bad stuff through derivatives right?
Plenty of Hedge funds out there betting on failure of entire countries...watched house of cards last night...ban the stupid hedge funds.
You got it backwards, we buy from them...look at the trade deficit.
Marker
It is more than a currency issue. I found this link posted on Karl’s forum. It includes a chart video, takes a few minutes, but helps to explain this somewhat. It is a different web site. Hope it is helpful.
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